Federal Reserve
FOMC Plows Forward with Measured Tapering
January 29, 2014
The decision to cut monthly purchases of mortgage-backed securities and longer-term Treasury Securities by $5 billion apiece matched analyst and investor expectations exactly and brings the cumulative combined lessening of quantitative stimulus to $20 billion per month from $85 billion to a new level of $65 billion. The $85 billion amount was introduced in September […] More
Fed Chairman Succession Timelines
July 17, 2013
It seems nearly certain that Ben Bernanke will not serve a third consecutive four-year term as Fed Chairman. His stewardship ends on January 31, 2014. Fed Chairmen are appointed by the president, subject to senate confirmation. Bernanke’s immediate predecessors were Paul Volcker and Alan Greenspan. The selection of Greenspan was announced by President Reagan on […] More
Bernanke Press Conference Highlights
December 12, 2012
Several questions were directed at the fiscal cliff, a term first suggested by Bernanke. He felt the metaphor was still good and didn’t support the position of some that if a deal can be reached a couple of weeks into 2013 that the damaging effect would be only slight. He reiterated that the Fed doesn’t […] More
Anticipating Coordinated Monetary Easing as Reported Data Were Mostly Soft
July 30, 2012
Share price gains overnight continue to reflect optimism that the ECB will take forceful action Thursday to preserve the euro. Stocks are up 1.9% in Spain, 1.0% in Germany, 0.8% in France and 0.6% in Britain. In the Pacific Rim, equities climbed 1.8% in India, 1.6% in Hong Kong, 1.1% in Singapore and the Philippines, […] More
When Humphrey Met Sadie and What the Fed Wants Us to Know
February 29, 2012
Federal Reserve Chairman Ben Bernanke gave Humphrey Hawkins testimony before the House Financial Services Committee on this Sadie Hawkins Day of 2012. The dual references to Hawkins, one for the testimony and the other for the day, are a curious happenstance. The testimony is called Humphrey Hawkins for the two sponsors of the 1977 Full […] More
FOMC Statement: Further Initiatives Not Expected and Not Delivered
November 2, 2011
Today’s statement from the Federal Open Market Committee acknowledges that growth strengthened last quarter partly on a reversal of temporary factors. But the views are retained that the declining pace of “elevated” unemployment toward the central bank’s desired range will be only gradual and that inflation is likely to “settle, over coming quarters, at levels […] More
Dovish Tones in Bank of England and Fed Reports
October 20, 2010
It has become gospel in central banking circles that important policy changes must be communicated clearly in advance in order to produce desired market reactions. Minutes from the Bank of England’s October 6-7 meeting and the Fed’s report on regional economic conditions, known as the Beige Book, constitute an education of the public to anticipate […] More
U.S. Vital Signs When the FOMC Met Previously
August 10, 2010
Since the June FOMC statement was released, the dollar has retreated 6.2% against the euro and 4.5% against the yen. Ten-year Treasury yields have declined another 30 basis points to 92 bps below their level when the Federal Open Market Committee met in late April. The Dow Jones Industrial Index is 2.8% higher than its […] More
Long-Term Slumps in Stock Prices
May 20, 2010
In an update yesterday entitled U.S. Unemployment, CPI Inflation, Stock Prices and Fed Policy, I quantified several data trends, which make a rate increase by the Fed this year unlikely. This posting looks in further depth at the prolonged weakness of stock prices, which is already more than a decade long. It’s not limited to […] More
Next Week
April 23, 2010
A really exciting week lies ahead for economic data junkies and central bank watchers. Thursday, April 29, sees the first of Japan’s four holiday closures, that being Showa Day to honor the Emperor’s birthday, followed by Constitution Day on Monday, May3, Greenery Day on May 4 and Children’s Day on May 5. Together these off-days […] More
